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Closing Bell

News/Business. Maria Bartiromo, Bill Griffeth. A guide through the most important hour of the Wall Street trading day. New. (CC) (Stereo)

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01:00:00

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Us 14, Google 10, Scott 8, S&p 7, Blackberry 4, New York 4, Apple 4, Maya 3, Washington 3, Citibank 3, Seema Modi 2, Earthlink 2, Hank Greenberg 2, Jack Bogle 2, Jonathan 2, Bob 2, Eric Schmidt 2, Peter Anderson 2, Bob Pisani 2, Vanguard 2,
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  CNBC    Closing Bell    News/Business. Maria Bartiromo, Bill Griffeth. A guide  
   through the most important hour of the Wall Street trading day....  

    January 29, 2013
    3:00 - 4:00pm EST  

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statement, so they are honoring it with some legitimacy here, although it has hot been vetted out completely. >> what happens if they are confirmed? >> well, i think it's one of those things if it's not true, will you see defamation lawsuits. >> oh, yeah. >> and if there's some truth there, you won't see defamation lawsuits. >> let's be clear, and it's important. this is from one paper. >> yes. >> "the miami new times," and i do not know the paper. maybe some of our viewers in south florida do. don't know what their reputation is. put out a 5,000-word story, did a lot of work and people like espn and others are buying it? >> have followed up on this. victor conte which did balco with ties to giambi and barry bond, considered the east coast version of balco, and a pretty big deal. it would be huge for a-rod, if it is true. again, he's denied it because he said he used steroids from '01 to '03, and this would is been much, much more recently. it's a big deal and this guy, anthony bosh, has ties to this
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side of the world in the past. i want to point out, know we don't have a lot of time but a report in this week's "sports illustrated" about another case, sports with alternatives to steroids is implicating ray lewis and getting a lot of questions down in new orleans as we're headed down there tonight. >> you're clean. i know you're clean. >> wouldn't get this body with steroids. >> that's all natural, baby. >> that's butterball. >> thanks so much, brian. thanks for watching "street signs" as well, guys. >> take care. hi, everybody. the rally rolls on. welcome to the "closing bell." i'm maria bartiromo at the new york stock exchange. the dow industrials back on the march to 14,000, and it is knocking on the door, scott. >> and maria, another big day on the street. i'm scott wapner in for bill griffith. today in this final hour of trading, will we make that run to 14,000? let's take a look at where we stand right now. the dow is up 68 points. not only to 14,000 watch, maria,
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but we are only about 1.5% away from all-time highs on the dow. >> unbelievable. >> that's how far this market has come, a market, by the way, that you've said for weeks has wanted to go higher. >> does not want to go down. >> you know who does not believe in this rally, the man behind gloom, bomb and doom report. he's here with us and we'll find out what his problem is with his market. in the boom part of his theory. when does the doom come in? we'll talk about that when he joins us. >> don't call him dr. doom for nothing and amazon out with its critical earnings report. this one has the holiday shopping season all over it. of course, with amazon, investors so far worry more about growth than actual profits. we'll see how the stock reacts once the markets come out. >> in the markets, see where we stand, the dow jones industrial average up 68 points, 13,950. last trade on the blue chip average closing in on that 14,000 level. the nasdaq composite looks like this today, a bit of selling going on for technology. of course, this has been the group that was the winning group all of 2012.
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we've been seeing selling in tech recently, and the nasdaq right now at 3149. s&p 500 looks like this. similar chart pattern as we approach the final steps, s&p up. >> and what a month that's been, dow industrial average up more than 7%, on its track for its best january since 1989 when it gained 8%, plus the s&p 500 has also been going gangbusters, on pace for its best january since 1997. >> so now we're closing in on 14k. also the all-time high back in 2007. that was all-time high at 14,164. we're awfully close to it. today mike selly is with us from ya finance and randy bateman and peter anderson from congress asset asset management and our own rick santelli. thanks so much for seeing us. thanks for joining us. randy, how are you allocating capital in a market on the doorstep of all-time highs?
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>> we obviously still like the equity market. you know, there were so many uncertainties coming into this new year, and now a lot of those uncertainties have been wiped away with the budget ceiling and the tax situation that i think gives us a great deal of improvement, but as dandy don used to say when he hosted "monday night live," when it became obvious, he used to sing "turn out the lights, the party is over," and i think that's what's happening now. investors are realizing that the bond market party may be over, and it's time to shift to equities. >> let me ask you again. how are you allocating capital then in. >> we like a lot of sectors in the equity market. we like energy, materials and industrials, and some of the technology names are looking really pretty right now. >> rick, it's a perfect segue to you. he said the bond market party may be over. is it? >> well, no, i absolutely do not think so. here we are still toying with 2% as we get close to record highs in the dow jones industrial average. there's an incongruent relationship there, just like
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there's an incongruent relationship with the fact that we're talking about the dow near records, and tomorrow morning at 8:30 eastern i'm going to be telling you that fourth-quarter annualized growth was a paltry 1%. >> peter anderson, you run a firm called congress asset management company. so i'm going to ask you. is washington, is congress the people who can derail this rally? >> well, listen. i don't think the rally is going to be derailed at all. in fact, i think even though we've only had a third of earnings so far, let's look at the results. we've had some very, very strong winners in some very strong losers to. me that's the sign of a balanced market. not everybody is getting a trophy for showing up these days, and that to me would be the sign of a raging bull market. i think there's more rationality in this market right now than there has been in a long time on the equity side. >> that's a great point. >> and i'm still very
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optimistic. >> a great point, peter. so you're looking at valuations then as one metric to make you believe that, in fact, there's a lot more rationale to what's going on today. what else can you point to in terms of supporting that idea that this market continues higher? >> well, as i said, maria, you know, now, what we're doing is finally people are looking at the results of earnings and weighing in on this. you know, if a company like pfizer has great results, it's reflected in the some price, whereas vm ware who has guided down is getting killed today, so that's a good sign, that we're rewarding the good news and punishing the bad news, but beside that, we're also on the front line of investor sentiment. i think that's also important. all our clients that we speak to are very, very positive this year compared to last year. sure, there's a concern about fixed income, whether or not that is a bubble, but there's always -- you can always argue that way saying there's a place and a diversified portfolio for
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fixed income, but on the equity side, i would say roll up your sleeves, dig deep and try to find those stocks that have idiosyncratic risks. the stuff that really has a special story that you can figure out and invest in and get rewarded for. >> michael santolli, are you getting tired of waiting for a pullback, or are you still going to hang in there looking for one? >> i don't know that i'm tired. what i find interesting. once it's obvious that the big risks are gone and the fact that sentiment looks like it's so much brighter now than it was a while back, i do think those are exactly the things that in the very short term you have to be a little bit concerned about. even though it seems like, and it's true on a clockwork basis this market want to sleepwalk higher, i think in the short term that's exactly the problem. we're getting very excited about a market that's up 2% in two weeks and 3% since mid-september. yes, it's record highs, but i do think that now we have agreement that in fact the markets will support, and i do think the market is well support bid all the factors, a very balanced
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stock market, i still think we'll overlook the fact that we're not priced to take any disappointment on the macro picture. don't want to talk about big-picture mega risks but basic trajectory of economic growth. not priced to deal with that just right now. >> it's a great point that you make, right? you're looking at the transports. they have in some respects validated the rally, small caps hitting highs so you've got the kind of broad-based group move that would give some sort of credibility, some sort of validation to the move, yeah in. >> and it's been -- it's actually a more balanced market. look back at the last two times we hit s&p at the 1,500 level in 2000 and 2007. this time, seven of the ten sectors represent at least 15% of the s&p. no outside bet whether it's financials or tech. i do think that's the context. that shows we're okay, and when high-yield bonds are yielding under 6% because basically people think that the liquidity and the appetite for that kind of risk is out there, then stocks are not priced in an excessive way, i don't think
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right here, but do i think on a tactical basis there's a little bit too much bullishness in a short amount of time. >> let me ask you about the interest rate scenario around the world. randy, peter, those who have got money in the market here, we're seeing country after country cut rates. we know the u.s. is in a low-rate mode. we know europe is the same thing. yesterday we saw colombia adding to latin american rates coming down. today we saw india, so is there a downside risk to all these rates coming down across the world? >> well, i'm sure there is. i think the downside risk obviously is when the rates do start coming back up, but the more -- the thing that i'm more concerned about, maria, is the fact that the fed has really pegged the policy to the unemployment rate, and that is unprecedented, and you do wonder what kind of unintended consequences will result as such a clear indicator and a clear communication of that kind of
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policy. i do think there will be unintended consequences, but in the meantime investors have plenty of options available. there's floating rate loans out there, for instance. many mutual funds offer them, and the rates adjust. move upward as rates increase. therefore, keeping the price of the bond about constant, so there are ways to take advantage if you're concerned about rates moving up and still staying in fixed income. >> all right, guys. thanks so much. >> it's ironic that one of the factors that we used to look at a couple decades ago was the fact that the emerging nations would cut their interest rates so that they could sell to the developed nations, the consumers in the developed nations. now we're seeing the exact opposite take place, seeing a lot of the big mega countries in japan and the united states and europe cutting their rates so that perhaps they can sell to that new consumer which is in the emerging nations. kind of ironic that that's taking place. >> definitely is. gentlemen, thank you very much.
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we'll see you soon. >> you're welcome. >> amson, the company to watch in the extended hours tonight getting set to report earnings right after the bell. let's get to jon fortt with the one number investors need to zero in on. that's that number in. >> i hate to say revenue is the number to watch because it feels like cheating, but with amazon it's really true, trading at ten times revenue. it will either make a tiny profit this quarter or no profit at all. the bullish story behind the stock is that it will dominate retail and make inroads into mobile hardware so the most important thing is probably that amazon's earnings report will follow the story line. the two biggest wild cards are kindle fire units and cost of goods sold which is largely shipping costs. if cogs came in higher and kindle sales came in higher, that could hurt earnings. of course, we'll have to see how much investors care about amazon profit revenues. it's mostly about the revenue. back to you. >> thank you so much. 50 minutes to go before we close it up here on wall street. the dow jones industrial average inching ever so closer to that
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14,000 mark. we're about 45 points away right now. >> amazing. and then there's apple, company announcing plans for a new ipad with double the capacity. ahead of the blackberry 10 release, stocks moving in opposite directions. it's rim versus apple next. >> uncle sam reading your e-mail, google and other e-mail providers could be forced to turn over the information to government agencies and the bar isn't high to force them to give it up. to the bottom that have story coming up. >> and after the bell, can't miss exclusive intervows with former aig ceo hank greenberg here with his side of the lawsuit against the government and then mr. gloom and doom coming up here on this side of the rally. back in a moment. with fidelity's new options platform, we've completely integrated every step of the process, making it easier to try filters and strategies... to get a list of equity options... evaluate them with our p&l calculator...
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to deposit checks from anywhere. [ wind howling ] easier than actually going to the bank. mobile check deposit. easier banking. standard at citibank. welcome back. apple debuting a new ipad, sort of, just when research in motion is set to launch its highly anticipated blackberry 10. seema modi with more on the two competitors. seema, over to you. >> reporter: last couple of weeks shares of apple have sold off while research in motion shares rally. today, a little bit of a flip. as you can see, apple shares are up and research in motion down, this, of course, coming in after
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apple is losing about 24% over the past three months while rim has nearly doubled. in late 2012 a series of sell side analysts raised their price target on research in motion. the catalyst there being the excitement around the blackberry 10 device and just this week as we approach d-day, seeing cautious commentary on the street. let me get you some of that commentary. rbc capital writing a lot of new on blackberry's bb-10 has already been leaked and ubs writing despite the hype surrounding the blackberry 10 much uncertainty remains. shares are lower on the day, but as we said before, apple shares moving higher after announcing the 120 gigabyte ipad. some reaction to that news. topeka capital saying the new ipad could compete in the notebook market. we'll have to watch out for that. scott? >> seema, thanks so much. seema modi at the nasdaq for us. would you rather own shares of
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apple or research in motion? let's start talking numbers. on the technicals ennis tanner in new york and on the fundamentals our own jeff cox is back at cnbc hq. biggie, good to see you again. beginning with you, apple or research in motion from a technical standpoint, which looks better? >> i really like apple. seema mentioned two have been on very divergents pagts over the last few months, but if we look at apple's longer-term chart, the three-year chart, the 200-day moving average has acted as a pretty good mean reverse indicator. during the uptrend apple didn't get more than 20% above it until it went parabolic, the move you didn't want to buy into and now apple has come 2bloat 200 -- da moving average and i think you're at the bottom here on apple. a much safer risk owe reward buy. rim, on the other hand, scott, looks dangerous to me t.rallied
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back to the $18, $19 level last week which was previous support back in 2011. i think that support has become resistance here so now on the recent selloff, i think it's in no-man's-land, i wouldn't touch it. >> rim is up 100% in three months successfully get it. this is kind of like one-armed david against goliath times two, but when you look at where you're heading in this market, in the technology space, we're in a fundamentally different world. apple has lost its ability to innovate. that's the perception in the market as far as traders go. they are looking at this as a stock that is basically just an index unto itself. money is coming out of there and going into new tech and now it's going to start to go into old tech, and you're just seeing, when we see this released tomorrow, i think you're going to see a new rim and a company dedicated to moving forward. >> and this is a show-me stock now, right? it used to be a benefit of the doubt. now they have to show you something for you to buy the shares all of a sudden.
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>> that's definitely true. >> that's changed. >> now the cash on the balance sheet and the low pe, the value aspect of the stock here is much more compelling than the last four money. one last point, jeff said the rotation has occurred, and that's certainly true, but i think the rotation has gone too far. fund managers are underweight apple which they haven't been in years versus overweight many of the tech stocks and stocks in alternative hands like rim. over the next six months i expect apple to outperform the rest of tech. >> the one story i like about rim is the cash on balance sheet. i do think that they understand the problems, that they are finally getting to the point where they are moving on this, shifting from a growth stock y to a value stock and is just beginning as far as a growth stock goes, so i like the picture in rim here. >> guys, good stuff. jeff cox and jeff tanner, see
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you soon. >> final stretch of trading here for the day. 40 minutes left before the closing bell sounds and a market up 74% on the industrial average. 13,955 last trade there. >> closer to 14,000. will it happen in this hour? well, we'll take you live to the trading floor to see how much momentum there is in this market. >> yeah, but there's still skeptics out of there. mark faver is one of them. why he's not believing in this rally and why he's predicting a 20% selloff. that's later on the "closing bell." got to hear this. back in a movement [ male announcer ] where do you turn for legal matters?
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. welcome back. 14,000 range for thedown. let get down to the floor and see what's buzzing. >> bob pisani and gordon charlotte are here at the nyse. jonathan from the nymex and holly liss from the cme. bob, give me what people are talking about as we make this march towards 14,000, the fact we're 1.5% away from all-time highs. what do people think we need to see to get to those levels? >> the federal reserve to do nothing tomorrow. if they essentially leave everything exactly as it is, talk about a slow recovery, that should get us over 14,000. at least that's the short-term thinking. i think the big story here is just how amazing the rally was. remember, it was four years ago, scott, we were at 6500 on the dow industrials. we're at 14,000 four years later, 110%, 115% advance. i think we should stop for a minute and consider what a rally
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it's been. >> yeah. it sure has. jonathan in, terms of the energy store and what you're seeing on the commodity side, are you seeing money coming out of certain areas to find a home in equities? >> i don't think we're seeing money moving out. i think we're seeing some people sitting on the sidelines for the most part recently. there was a pretty solid run-up over the last few sessions and it seems like it will continue to push higher and we'll get to that $100 mark, at least tested within the next week or so most likely. >> gordon, is this move in the market irrationally exuberant, or are we where we should be? >> an interesting dance. unemployment is coming down a little bit but not enough to scare people to think that the fed is going to do something to alter the course they are going on, low interest rate environment and a big demand for credit so everything is right where it needs to be for this market to continue to grow here a little bit. also a little bit of a short squeeze and more importantly, scott, a performance squeeze,
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right? guys getting left at the gate here a little bit january. starting to fall behind on the performance and underperforming on the s&p, will worry about redemptions and those kinds of things. do i wait for the dip or get involved and a lot of people are saying i can't afford not to be involved in this market right now? >> hole, we're looking at the bond market today and sitting right about 2% or so on the ten-year. what is the level that pushes people in large numbers out of treasuries and into stocks in a meaningful and noticeable way? >> well, i think we've already seen some of that and clearly this 2% level, if you start breaching that moving higher, i think you're going to start seeing more money into treasuries and the equities. however, i would argue from a risk/reward segment that now is the time to buy treasuries. the 2% level is critical for many elements, 233-moving day average and 60% retracement of last year's range. there's many elements coming in
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here and i think from a risk owe reward perspective you want to take a stab at buying this 2%. frequently the treasury market does not go right through an element and continue it. it tests it several times. we've test it had one time. i think it's going to hold here. you've got many things here that could promote buying of treasuries. you've got the ltro announcement which comes out weaker. you can see people want to go into treasuries. you've got the fed. if they don't change, and they are moving to a more dovish makeup, that could be what does it, and, of course, you've got the employment numbers coming out. if those come out weaker, again, the 2% was too much too fast and it's a buying opportunity, maybe all the way back to 170, 160. >> i'll give you another catalyst, scott. when people get their cut you recall statements and their bond funds are down for the first time in ages and the stock funds are up notably again, that could be the start of another little wave of movement out of bonds and into stocks. >> let's not forget the federal
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reserve and the c-car announcements likely leading to dividend increases for the banks. >> gordon, what do you see as an indication of how the market closes up, a real here of 77 points? what are you expecting at the close? >> want to take them through. still a little bit of upside to this thing. every time we've had a move to the upside haven't been able to sell them off, they have held them and rallied them. a sloppy opening and then they carried them through. they will carry them through for a little while. they will carry them through today but it's coming. >> at what point does $100 oil become a headwind to the stock market, if at all, because we're not that far from it now? >> i don't think it will become much of a headwind considering the fact that we're basically there. dealing with crude oil for $90 for a while and equities have still been moving higher so i don't see it as much being a fear factor as it used to be back in, you know, a few years ago.
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>> one little note of caution here. the rallies are getting narrower and narrower, guys, and this is a sign of traditionally market top. nasdaq is doing nothing. s&p is doing nothing today. the dow is up so it's very narrow, 4-3 advancing to declining stocks at the new york stock exchange. that's not a particularly robust rally that we're seeing. >> should also point out volume, scott, because volume has really mott been there and seeing a light situation so the participation has not broadened out as much as you would like to see. that could be a positive. maybe at some point if the market continues where it is, it broadens out. >> they are due for some kind of correction here. there's going to be a correction of some kind. the question is what kind of correction and how long will it last and from where we're sitting doesn't look too severe and probably temporary. >> feels like you have a tug-of-war between sort of technicals and sentiment that, yeah, i mope, we may be overbought, but sentiment appears to be so strong object other side that it may not
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matter. bob? >> also, if you get that selloff in the equities, that could also be another motive for the risk-off trade where you start seeing buying in treasuries, and when you talk about overbought in the equities, you've got the complete opposite in treasuries, such an oversold market. the rsi and ten-year futures is below ten. seems like every time we've dipped below there over the past several years, a significant rally, minimum of a point and a quarter, point and a half in the future. if equities come off that could be another impetus to move away from treasuries and into the lower yields. >> thanks, everybody. appreciate it. >> we have 30 minutes to go here before the bell rings on wall street, and we're pretty much in that holding pattern, plus 75 on the dow, so about 45 or so points away from dow 14,000. >> and then there's washington, scott. so ceos lobby washington to fit the debt in this country, but did they get anything more than lip service?
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welcome back. the markets continue a strong run on wall street despite no solution to the country's debt and deficit. >> now some republicans suggesting the only way to get any cuts this year is to allow the automatic spending cuts known as sequestration to kick in. so joining us now, may macguineas head of the campaign to fix the debt and one of the newly added fix the debt ceos rolla huff of earthlink. maya, let me begin with you first. within the last hour,ry reid, the senate majority leader said the following. these are his word. democrats to look at further short-term deferrals of planned spending cuts and would involve new revenues and other spending cuts following comments from paul ryan this weekend saying republicans are not afraid to let the sequester happen. what's your reaction to all of that? >> well, they are teeing up for
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the next political battle, and as we've seen in the past round of these debt deals where what you would have liked to see is a big grand bargain to figure the problem but instead we've been seeing these small incremental bits, the bare minimum, i'm worried that they are taking about ways that entrench on both sides instead of thinking about how do we focus on what needs to get done and haven't done yet? reforming entitlements and the tax code and putting in place a deal that's big enough, bigger than the sequester, to actually put the debt on a downward path, and we still aren't talking in real terms about what we need to do to fix the situation so i'm worried about this approach. >> yeah. rolla, i'll get to you in a moment but on maya for a moment, maya, thanks for joining us today. i want to get your take on sort of how this market plays into everything. we all know that really the market did not respond to all the problems at the end of 12. kept going higher, the enending
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fight over the fiscal cliff and here we are about to approach the debt ceiling deby the and at record highs in the market. does this become helpful. alan greenspan used to look at the stock market and say there's a wrelt effect. when the stock market is going up people aren't worried about debt. are we fooling ourselves that we're looking at the market going higher and a wealth effect going on and there's real problems that have yet to be addressed in. >> that's a great point. in each of these moments they are responding to two things. kind of an action forcing moment. we had the cliff and now we'll have the sequester and continuing res hughes, and the market wants us to resolve these issues and each time we skirt around them, again, with the bare minimum, but we don't really fix the problem, and my concern is the market responds positively because we don't have the immediate problem, but we're really putting cap on what kind of growth, recovery, real
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competitiveness we can have in the economy until we fix the debt overhang. what you're saying it lulls us into a complacent moment and people are saying, well, we've already done some deficit reduction, maybe we known the need for more. not cure. this is a cancer on our economy. we've got to fix a problem instead of waiting for marks to turn against us. we should do it while we have the luxury of time on our side as we do now. >> rolla, ceos from industries far and wide have been brought to the white house for meetings. they have met with leadership on both sides of the aisle, yet do you think that you guys, your fellow ceos are even fact oregon into the discussions, or is it all just lip service? yeah, we hear you. yeah, we're going to cut the deficit. yeah, we're going to do this but they don't do anything. >> i'm not really sure. what i do know is that watching
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this has just -- it seems like we're watching an accident in slow motion. there is no question that we have to put in place entitlement reform a chamging the tax code if we're going to have sustainable long-term economic xwroerkts and from where i sit that's the only thing that makes the math work. >> but the actions don't meet those words. everybody knows what the solution is, yet it doesn't seem as though there are elected officials, to borrow our own phrase from a few weeks back, doesn't seem like they are willing to rise above and do what people like you have told them to their faces needs to happen to get the economy really back on track, to get people like you to hire more people and get the unemployment rate lower. >> well, you know, i think that -- i think that it's going to go beyond ceos. i think we're hearing it from our customers. earthlink spends a lot of time working with small businesses. people are frozen right now because there's so much
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uncertainty about what it going to come next. when you see an accident happen, you can turn away from it, scream and try to avoid it. i think we node to get together and insist that this be avoided because it can be avoided. >> let talk about the implications if we don't. can we just keep raising it, what are implications? what is it so important? >> consequence of inaction is the ones that i worry, no enough people understand is so severe. if we continue to borrow expesively like in the past, it means orsisy won't recover. growth won't take off. we won't be able to hire. the people recovery, the jobs recovery will not take place. people will not work unless there's a stability and a debt deal put in place that allows
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families, big and small, to plan and invest and make longer term changes and investments so that the economy can grow and that we know what to expect. beyond that, of course -- >> why is this important to get involved in this, rolla? >> it's important to our customers. i mean, we see it every day. we have to plan our business around what we see coming in the future, and when you don't understand the future, you effectively start to freeze, and we're seeing that in the marketplace now. people are not making long-term decisions. you know, so much of the capital gets their return by taking risk is being squeezed out by risk that's been taken really by this whole presses. i wanted to be a part of sending that message. it's important. >> guys, great to talk to boest you. >> thanks so much. >> an issue we'll follow.
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mean time, highs at the day, 40,000 aw-- 14,000. >> is that sustainable for the rest of 2013? is the have had investor going along for the ride? we'll talk to the man who runs the world's largest exchange-traded fund. he's coming up. >> and then we'll hear from one person who says investors need to brace for a huge selloff. there he is. mark faber, gloom and dom reports himself. dr. boon reports why he's so bearish on the markets. >> that's ahead. rock 'n' roll.
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welcome back. the et or exchange rated fund celebrates its anniversary. the spider etf started 20 years ago just shy of $7 million in assets. now it's over $123 billion invested and is the largest etf out there. >> amazing. as for the industry, by the end of 2012, assets totalled over $1 trillion with more than 1,200
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funds to choose from in the etf universe. state street is at heart of it all, one of the largest etf providers worldwide. jim ross runs that business. he joins us now along with our own bob pisani who has been covering the etf business from day one. jim, tell us about investors what. are you seeing in terms of flow right now? is this an institutional business, or are individuals going for the etfs? >> great thick about the etf product individuals use it the same way as institutions do. institutions use it for hedging intraday and some of the more active trading that you see. retail investors, use etf to get broad diversification and narrow diversification into narrow sectors and industries. >> how much so much money has moved into etfs this year? it's been huge for the last couple of years, but 2013 what, a powerful move. >> 2013 -- 2012 was a fantastic year. i'm hope 2013 is as good if not better. >> the beginning of the year looks like it.
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>> really strong. really, investors have seen the benefit of using etfs to build portfolios and helping them diversify across a spectrum of different asset classes for their own risk focus. been really, really strong. low costs and trade intraday, and they can real help you diversify your portfolio. >> really money coming into at the expense of mutual funds. not everybody is on board with the etf movement. want you to listen to an exchange that happened recently on the "closing bell" here, vanguard's jack vogel had this to say. let's listen and then we'll resglakt are we ovr react. are we overdoing this, all the exchange traded funds and everyone getting into asset management funds now? are we at an extreme point in that regard, do you think? >> yes, i do think we are. there are a whole lot of them. bill, i hate to see it, a whole
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bunch of nut case etfs out there, the host marketing idea of the 21st century here, and a lot of people jump on the bandwagon. >> nut case etfs. >> what do you expect from the guy who created indexes? i mean, this is a -- >> there are, bob, a lot of mutual funds. i mean, it's like you can get them -- an etf. >> we love jack bogle but he fought etfs in the beginning. his own company decided to go over his head and go back into etfs and go where the money is. a monster now, mr. brennan now running vanguard, decided to override essentially jack bogle. >> he's talking about junk etfs, hedged etfs. >> and if you ask jack if he thought there were exotic mutual funds that shouldn't be in the marketplace, he would find a couple of those.
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>> this industry has been growing and i've been a champion from the beginning because it makes more sense for investors. it's indexed and low cost and for self-directed investors clearly the way to go. my question to you is when will it get bigger? 1.3 trillion in etfs. only a tenth of the size in the mutual fund industry. how about cracking the 401k business. can that happen? >> that's going to be huge when it does. >> it will over time. i look at 1.3 trillion and 1.4 trillion and say we've done a good job in a short amount of time. mutual funds start at the 1930s. think we're doing a good job. this isn't about etfs versus mutual funds. when you think about where a lot of the etfs have come from it really came from stock traders who real wanted the ability to diversify more in one trade than they could buying five or six tech stocks. >> what keeps this going in 2013? >> i think when you lock at there's a marketplace out there what's called etf strategists and they are building portfolios for their clients, actively
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implementing strategies around how to diversify risk, but they are doing it with etfs and that channel is just starting to grow. hit 70 billion, 80 billion last year. i see that plus the potential for active etfs continuing to explode this marketplace. >> all right. so innovation. new innovative etfs. >> despite all the shrinking we're seeing in the stock business, this is a part of the area that's growing and jobs are being created. how many jobs, people working the etf business now? >> we try to get our hands around some of those numbers. it has to be in the tens of thousands when you think about all the folks from a marketing perspective. you lock at ads. there's a lot of advertising running. >> and growing. >> you'll have that spider come down when you ring the closing bell? >> that will probably hit me in the head. >> we'll be watching that. good to have you on the program. >> thanks for having me. >> as always, thank you so much. >> scotty? >> all right, maria. a little more than ten minutes to go. 35 points away from dow 14,000 plus 38 and that's pretty much the highs of the kay.
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>> current aig ceo bob benmosche, refused to join former chairman hank greenberg in a lawsuit. he'll explain. >> first, what's the biggest threat to your privacy, the government trying to access your e-mail or a company like google using your personal information to pump up profits? that's next. [ man ] i've been out there most of my life. you name it...i've hooked it. but there's one... one that's always eluded me. thought i had it in the blizzard of '93. ha! never even came close. sometimes, i actually think it's mocking me. [ engine revs ] what?!
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quattro!!!!! ♪
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welcome back. google says it's working hard to protect your data from the government joining forces to lobby other companies for updated privacy laws to make it harder for the information to be subpoenaed. the company says government requests increased more than 70% since 2009. >> they are constantly getting requests for people's information. current privacy law dozen not require government investigators to have a search warrant to obtain your personal information from internet companies, like google, among others. in fact, i asked google's then ceo eric schmidt about these privacy concerns for the cnbc documentary "inside the google." >> people are treating google like their most trusted friend. should they be?
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>> i think judgment matters. >> eric schmidt is google's ceo. >> if you have something that you don't want anything to know, maybe you shouldn't be doing it in the first place, but if you really need that kind of privacy, reality is that search engines, including google do, retain this information for some time and it's important, for example, we are all subject in the united states to the patriot act. it is possible that that information could be made available to the authorities. >> so do we need google to protect our information from the government, or is the bigger threat what google does with our personal information? this is a huge story, skompt it's getting bigger and bigger and bigger which is why i think internet privacy companies securitizing all this data is probability biggest growth business of all. >> well, you don't want google to be giving your personal information to a third party. you don't want them to be doing anything that you would, i guess, deem unseemly with it, but on the other hand you don't want the government taking i can't believe what we just read the government does not need a search warrant for e-mails
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stored online, most shocking thing for me of all. >> so many companies, facebook, google, they all tell me the same thing, they constantly get requests from governments. the u.s. government and other governments because they want information about people, when they are doing investigations. it could be a direct or indirect link. they want the info, so the horse has left the stable, that's it. no more privacy. >> would you know more than most from your emmy-winning documentary, i must say. >> thank you, scott. >> we've got a market that is on fire headed into the close. check it out. up 80 points in the dow jones industrial average. nasdaq has turned. it's now positive even though it's real been the laggard in this market. >> had to give you some props there. did amazon have a happy holiday, or are profit margins getting even tighter? full team coverage of the online retailer's latest earnings due out on the end of this close. >> marc faber says we're eventually headed down.
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he's here to tell us what's problematic with this mart. stay with us. [ coughs ] [ angry gibberish ]
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[ babies crying ] surprise -- your house was built on an ancient burial ground. [ ghosts moaning ] surprise -- your car needs a new transmission. [ coyote howls ] how about no more surprises? now you can get all the online trading tools you need without any surprise fees. ♪ it's not rocket science. it's just common sense. from td ameritrade. welcome back to the floor of the new york stock exchange. maria and i are down here for the closing countdown. about 40 points away. >> yeah. >> from dow 14,000. 200 points away from the all-time highs on the dow. >> amazing. >> the market, as you have said, wants to go higher. >> wants to go higher. feels like it wants to go higher, but i wonder how much volume is an issue.
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let's bring in peter costa here. in the middle of it every day. peter, does the fact that volume every day, really anemic numbers worry you, that it's going to get in the way for this market to go higher? >> i think when there's not a lot of volume holding the market down, the market can go higher. i mean, you know, all depend on what the bias is on what we see on the trading floor. if the bias is to the buy side, we'll go through 14,000 which i don't think we'll do it today, but we definitely will do it this week, and i also feel we're probably going to reach new highs at some point this week or early next week. where it goes from there, i don't know. volume is not a really indicative institutional investing. >> you don't care that the volumes are low. >> not right now. >> not relevant. >> if you look at say the near-term catalyst. amazon is going to be after the bell tonight. technology largely hasn't participated in the latter stages of the move. if you look at apple and things like that. a jobs report on friday what. are you looking at? >> i still think there's
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positives to the market. i don't think we have this next leg of a bull market because i don't think the economy warrants it. i still think with 7.7% unemployment it still doesn't warrant, you know, 17,000 on the dow or whatever some people have been saying. i've been reading. i don't think it warrants that yet, but i do think, that you know what? we do have -- there are positives. the numbers are starting to come down which is good. housing, even though today's numbers and yesterday's numbers weren't really great, are getting a little bit better and starting to see trends going higher. >> and i always say what are the alternatives where you've got this rock bottom interest rate world. >> let me ask you quick. just said institutions. largely an institutional market or largely institutions buying or do you see the retail inve investor creeping back into this market? >> a lot of institutional investors crept to the sidelines. they are moving out of the way and letting the retail do what they do. when they are in, i